On Kenya’s ‘Slum Island,’ mobile payments could launch micro grids

A cloud-controlled metering and payments system hopes to create efficient energy use.

It's not for nothing that Remba, a tiny island in the middle of Lake Victoria, is known as "Slum Island."

A few thousand people, mainly fishermen, make their home on this busy outpost on the border between Uganda and Kenya. One-room shacks are the norm here, and the fishermen almost literally live on top of each other. They share shacks, with one group sleeping in the day while the other fishes. They swap at night.

"It's a bit like a LEGO village," says Harrison Leaf of access:energy. "All the big characters are right there on each other's doorsteps.

In this underdeveloped "LEGO village," Leaf and his team have set themselves a lofty challenge: proving that micro-grids, combined with a mobile-payments system, can bring power to rural East Africa. And what's more, they want to prove that it's good business.

Using an installation of wind turbines and solar panels, combined with a cloud-controlled metering system and a payments system that lets users pay for power using their mobile phones, Leaf says they can take micro grids out of academic circles and make them a business reality. Starting with Slum Island.

"The whole industry at the moment feels like it's alight with the word 'micro grid,' but very few commercially viable examples are out here yet. It's still university territory, research territory," he says.

It's estimated that there are less than 500 micro grid projects globally, including a solar-powered micro grid that went online in Cape Verde in 2012. The need for alternate approaches to energy, like these, is obvious. An estimated 84 percent [2011, PDF] of Kenyans lack access to the grid, with that figure increasing in rural areas. In urbanized areas, the high population density makes connecting people to the grid cost-effective. In rural areas, that calculation becomes more difficult.

"That space is still open to some kind of modern electricity service. We think micro grids are an answer," says Leaf.

access:energy was founded in 2009 and initially focused on developing wind turbines that could be manufactured locally in Kenya. They then moved their focus to the installation of micro-grids, before realizing that the missing link was neither the technology nor the logistics of building micro-grids but rather the business behind providing power to places like Slum Island.

"There's lots of great companies out there that have lots of great generation technology and great companies that install really ambitious large installations," notes Leaf. "What's lacking is the layer of sophistication that allows you to do some interesting business model innovation, like pay-as-you-go metering and individual line monitoring in completely far-flung remote contexts."

On Slum Island, which is run by an administration prosaically named the "Beach Management Unit," power is currently generated for some of the island using petrol and diesel generators. "[Generators] maybe cover 10 percent of the houses and some of the bars, but for the rest of the people living there it's candlelight, kerosene lamps, and charcoal," says Leaf.

He believes the way that you improve the lives of people like those living on Slum Island is not through charity but with good business. He praises hugely successful projects like those run by SolarAid, which tries to replace the use of kerosene lamps with solar-powered lamps to improve the health of people who would otherwise be inhaling deadly fumes. "[But] you can't run a business on a lamp, you can't run a business on a three-watt solar panel," he argues.

"We're of the camp that believes that if people value something then they will pay for it," Leaf says. "We think the way to really achieve development results is to treat people like adults and design a great product that they love that works for them and get them on board with a business."

A 2012 MIT Technology Review feature on micro grids posed a frank question about micro grids: "Will this just be a cute development thing? Or will it become part of mainstream economics?" access:energy has previously worked with NGOs on micro grid solutions, including on six fishing communities around Lake Victoria. But meeting the challenge of that question will require demonstrating that there's a realistic business model too.

Leaf and his team are trying to raise startup money via IndieGogo for the first installation on Slum Island—the idea to create a proof of concept with which to attract commercial investors. With just a few days to go and well short of their target, it seems unlikely that they will reach their $30,000 (£19,300) target in time.

If they don't meet the target, Leaf says they'll go down a more conventional route, investing their own money and seeking angel investors.

In the meantime, the daily routine on Remba, "Slum Island," continues. Fishermen are drawn there by the tilapia, a fish that sells internationally. This tiny, underdeveloped island, says Leaf, "is the first link in the supply chain, and that chain links to Europe."

This article originally appeared on Wired.co.uk. You can read it as it initially appeared here.

25 Reader Comments

Seems to have a fatal flaw-- if these destitute people can't afford electricity, what makes you think they can afford cell phones and cell service? Clearly, having a mobile phone comes somewhere after electricity in any hierarchy of needs.

Seems to have a fatal flaw-- if these destitute people can't afford electricity, what makes you think they can afford cell phones and cell service? Clearly, having a mobile phone comes somewhere after electricity in any hierarchy of needs.

I think some people in Kenya already do have mobile phones, and no electricity. Mobiles phones are not as expensive in some countries as they are in the West. On the other hand, electricity requires the regional government to have its s**t together.

Crowd sourcing like this annoys me. I would have pitched in, but I'm only hearing about it now. I have some Kenyan friends on Facebook that are click share activists, and would definitely have shared this with everyone. So I can only assume that these guys thought crowd sourcing would be a great way to get started but then neglected to tell the crowd.

Seems to have a fatal flaw-- if these destitute people can't afford electricity, what makes you think they can afford cell phones and cell service? Clearly, having a mobile phone comes somewhere after electricity in any hierarchy of needs.

You would be surprised. Phones allow them to checks the market prices before hitting shore, allowing them to deliver were they can get the best prices rather than take a chance.

Seems to have a fatal flaw-- if these destitute people can't afford electricity, what makes you think they can afford cell phones and cell service? Clearly, having a mobile phone comes somewhere after electricity in any hierarchy of needs.

Cell phones require far less infrastructure than electricity, land-line telephone, or even running water. It's also subject to less corruption by government officials. And there are no copper cables to dig up and steal.

The situation in the developing world is such that cell phones are the cheapest and most reliable way to set foot in the modern era. Towers are relatively inexpensive to install and relatively secure against theft. Cell phone batteries can be charged on boats or with solar panels, generators, or larger batteries. Conventional Western-style utility infrastructure, on the other hand, has failed repeatedly in these areas, owing to the high costs of deployment, pervasive theft of service and eventually equipment, and corruption between officials and the companies hired to deploy it.

In fact, I see it the other way around. I'm not sure this community has such a need for an electrical grid with a micro-payment system, when they seem capable of sustaining themselves without it. They're either out working or at home sleeping, and the need for electricity seems to end with charging their phones. I'm all for benevolence and improvement and development and charity, but this seems like a problem this community would have solved on its own by now if it had been a high priority. I don't think it's for lack of technology and cloud-based payment systems that they haven't rigged up a grid of their own by now. Could be wrong, but the first thing that comes to mind with a system like this is a pipeline of pennies flowing into deeper pockets.

Seems to have a fatal flaw-- if these destitute people can't afford electricity, what makes you think they can afford cell phones and cell service? Clearly, having a mobile phone comes somewhere after electricity in any hierarchy of needs.

Mobile phone penetration is pretty high in Kenya. A mobile phone can be bought for as little as $15. Indeed, an individual's mobile number may be their only unique signature, as many people do not own land, have a bank account, a postbox, ect...

As for owning a mobile phone without having electricity, kiosks that offer cellphone charging for a fee do brisk business in slums and informal settlements all over Africa. Electricity is a precious resource.

Seems to have a fatal flaw-- if these destitute people can't afford electricity, what makes you think they can afford cell phones and cell service? Clearly, having a mobile phone comes somewhere after electricity in any hierarchy of needs.

At the risk of piling on, remember that a lot of dumbphones have at least basic GPS capability.

While a single-channel GPS units (meaning it reads one signal, then shifts to another, then another, etc) won't get you a lot of precision, it's enough to mark good fishing spots or remember where you ran lines. Or, perhaps more importantly, mark areas where there are underwater hazards that might tear your boat up.

I wonder if a mesh-type energy grid would be reasonable? Like, sell (or distribute) kits with a few panels and a basic battery setup, then interconnect so you can load-share across the grid. Could be especially useful for community services like clinics that might not have enough roof space to run their equipment, but could sip from everyone's panels. Or, in Kenya...the local cell tower, to reduce fuel costs for the generators they presumably attach.

Seems to have a fatal flaw-- if these destitute people can't afford electricity, what makes you think they can afford cell phones and cell service? Clearly, having a mobile phone comes somewhere after electricity in any hierarchy of needs.

Cellphone service is cheaper than electricity, and a cell phone can easily be had for 10 USD.

A standard Nokia cellphone gives you a camera, mp3 player, FM radio, games, internet access, and of course, the ability to make and recieve phonecalls.

That would IMHO put it way higher on the list of basic needs than electricity.

I've seen, and that's likely the norm, sell phone charge stores. What you do is probably bring in your phone, and they'll swap your battery for a small fee. Another reason why Nokia is so popular in the 3rd world.

Has anyone asked whether they *want* electricity? An area like that may be best served by delivering a few solar-powered phone chargers, not by finding a way to extract micropayments from the residents.

It's not a rare thing that more harm than good comes about when "the West" starts meddling in Africa's affairs. The book "Dead Aid" by Dambisa Moyo (from Zambia) is a good place to start reading on the subject.

Has anyone asked whether they *want* electricity? An area like that may be best served by delivering a few solar-powered phone chargers, not by finding a way to extract micropayments from the residents.

It's not a rare thing that more harm than good comes about when "the West" starts meddling in Africa's affairs. The book "Dead Aid" by Dambisa Moyo (from Zambia) is a good place to start reading on the subject.

Right, though solar chargers might be too expensive. Stove-powered cellphone chargers would probably be slightly more possible, dung, wood, charcoal or other biomass would be readily available.

Seems to have a fatal flaw-- if these destitute people can't afford electricity, what makes you think they can afford cell phones and cell service? Clearly, having a mobile phone comes somewhere after electricity in any hierarchy of needs.

You'd be surprised how these 'destitute' people have adopted mobile payment systems better than Westerners

How on earth these people could afford $30,000 when their income is merely as much in whole? I could imagine some one with a good heart, who wants to improve the life of these islanders. But reality is another thing. You couldn't do business without the reality present. It is a dream. So dream on.

The problem with selling them electricity is that they'll need to pay for the infrastructure even when they don't use the electricity. In rural Cambodia, power is delivered via car batteries. It will run light bulbs, radios, TVs and recharge your cell phone. When it runs out you drop it off to be recharged, as somebody in the village has a side business of recharging batteries with a generator.

The problem with selling them electricity is that they'll need to pay for the infrastructure even when they don't use the electricity. In rural Cambodia, power is delivered via car batteries. It will run light bulbs, radios, TVs and recharge your cell phone. When it runs out you drop it off to be recharged, as somebody in the village has a side business of recharging batteries with a generator.

There you go. This is a good alternative than running a costly power grid nobody want to pay for. Don't you people have recreation centers for the kids to watch TV at nightfall? Some Asian countries I have been have those centers just for the kid and adults to gathering together watch TV and chat with each other.

How on earth these people could afford $30,000 when their income is merely as much in whole? I could imagine some one with a good heart, who wants to improve the life of these islanders. But reality is another thing. You couldn't do business without the reality present. It is a dream. So dream on.

The crowdsourcing campaign is not raising money directly from that community.

Has anyone asked whether they *want* electricity? An area like that may be best served by delivering a few solar-powered phone chargers, not by finding a way to extract micropayments from the residents.

It's not a rare thing that more harm than good comes about when "the West" starts meddling in Africa's affairs. The book "Dead Aid" by Dambisa Moyo (from Zambia) is a good place to start reading on the subject.

I think most people like having electricity. It's useful for quite a lot of different things.

We can sit here in the West and imagine only one or two things that those over there will do with electricity. People on the spot can surely thing of more.

Seems to have a fatal flaw-- if these destitute people can't afford electricity, what makes you think they can afford cell phones and cell service? Clearly, having a mobile phone comes somewhere after electricity in any hierarchy of needs.

Many of the solar lanterns sold in Kenya have USB outlets that can be used to charge a cell phone. Not to mention, the cheapest cell phones that can support mobile banking can be purchased for as low as $40. It's not like they're going to be in the dark when the sun goes down.

Crowd sourcing like this annoys me. I would have pitched in, but I'm only hearing about it now. I have some Kenyan friends on Facebook that are click share activists, and would definitely have shared this with everyone. So I can only assume that these guys thought crowd sourcing would be a great way to get started but then neglected to tell the crowd.

I think most people like having electricity. It's useful for quite a lot of different things.

Like creating light that doesn't either poison you or run as high a risk of burning your shack down.

The latter depending on the wiring being professionally done.

I ran into a article some time ago about a shanty town that had its own power grid. The wiring ranged from borderline professional (i think there was at least one "unemployed" electrician going around) to downright suicidal (re-purposed POTS wiring and no fuses). A single mom they talked to had her shack burn down because of badly dimensioned wiring and no fuses.